Withdrawals at the unit, which accounts for about 56
percent of the Baltimore-based firm’s assets, are coming to a
“final conclusion,” Fetting said today at the Barclays Global
Financial Services Conference in New York. “The performance
improvement is profound,” he said.

At the end of June, more than 72 percent of assets at Legg
Mason’s Western Asset Management unit were in funds with the two
highest ratings of four and five stars from Chicago-based
research firm Morningstar Inc., compared with 7 percent two
years ago, Fetting said. Investors have pulled more than $250
billion from all Legg Mason funds since March 2008 as they
lagged behind rivals, including $9.4 billion from bond funds in
the three months ended June 30.

Legg Mason managed $656 billion as of Aug. 31. Its shares
rose 38 cents, or 1.3 percent, to $28.91 at 9:53 a.m. in New
York Stock Exchange composite trading.